Hearings - Statement
 
Statement of James M. Inhofe
Hearing: Full Committee Hearing
An Informational Hearing on Pending Nominations
Wednesday, February 8, 2006

I want to welcome all of our nominees here this morning. Today we have seven very qualified nominees before this committee: 6 have been nominated to serve on TVA’s Board of Directors: Dennis C. Bottorff, Robert M. Duncan Sr., Susan Richardson Williams, Bill Samson, Howard Thrailkill, and Donald DePriest. And we also have Terrance Bracy, who has been renominated to a position on the Board of Trustees at the Morris K. Udall Scholarship Foundation.

We have so many TVA nominees here today because we have restructured the TVA Board. It was restructured, not only to modernize it - the old structure was in place since 1933 – but also because there have been ethical concerns with past boards. Before we get into those issues, let me say that I have been very pleased with the current board – Bill Baxter, Skila Harris, and the recently retired Glenn McCullough - they have all served the people well and worked to serve the best interest of those in the Valley. I want to publicly voice my gratitude to them. But in the past, specifically during the tenure of Chairman Cravin Crowell from 1993 to 2001, there were serious ethical concerns. It’s no secret that there was overwhelming evidence of cronyism, no bid contracts, and other shady dealings that we would all consider unethical, excessive, and abuse of the office. The abuse was chronicled by many major publications, including the Los Angeles Times and Time Magazine. The TVA Inspector General investigated the situation and called it “public perception of favoritism” and there was “lack of TVA oversight and controls which allowed certain consultants to make excessive profits, overbill and sometimes be unaccountable for their services and charges.” While laws may not have been broken, and it is certainly characteristic of the unethical to be very careful and try not to break the law, but it is clear that these actions were unacceptable. Fortunately, new leadership at TVA cleaned up the mess and the TVA was reformed. And that reform continues today with the new board structure that is represented by these extremely qualified nominees.

I bring up this ethical issue, not only as a warning to the nominees, but also because my constituents in Oklahoma are facing something very similar today by the CEO of the Grand River Dam Authority, former State Senator Kevin Easley. The GRDA was created by the Oklahoma Legislature in 1935 and is today very much Oklahoma’s version of the TVA. It manages water systems and produces power for Oklahoma. And much like the TVA of a decade ago, Chairman Easley appears to have taken the route of using the GRDA and its customers, my constituents, for his own benefit and for the benefit of his political cronies. I have a special dog in this, my father-in-law, Glade R. Kirkpatrick, wrote the legislation to create the GRDA and he did so with the intent of the GRDA to serve the people and interest of Oklahoma. Unfortunately, Chairman Easley appears to be using the people of Oklahoma to fill his appetite of luxury and excess. Let me highlight a few examples of what has been alleged by those who know the GRDA very well. And I ask you nominees to recall the TVA a decade ago. This would be a great book, but it would have to be a novel because no one would believe it.

Chairman Easley, in his final term as state senator due to term limits, co-authored state legislation that overhauled the GRDA removing the current board to provide for completely new appointments. This new board then hired Easley to serve as CEO giving him a three year contract and a raise of $15,000. His salary is now above the annual salary set by state law, and more than the Oklahoma Governor makes. Let’s be sure we understand – Chairman Easley legislatively created a job for himself to pay for his excesses the first thing he did was to raise rates and fees.

Through legislation sponsored by Chairman Easley serving as a state senator prior to his appointment as CEO, the GRDA was exempted from traditional state oversight including the Open Records Act. A total of nine pieces of legislation have been passed by Easley or colleagues since 2001, eroding the transparency and limitations of this state agency. But not to worry, there is oversight. Easley’s own mother, State Senator Mary Easley, currently serves as the Vice-chairman of the state Senate Energy and Environment Committee which has oversight of the GRDA. And Mama’s watching his every move.

Chairman Easley purchased a $550,000 jet helicopter used by Easley and his friends for their own travel. Easley has purchased three boats since 2004 all valued at over $50,000. His third boat purchase was a $66,213 Cobalt with a 10-disk CD player and a sharkskin cover that Easley assures will “eventually” become part of the lake patrol fleet. Easley also purchased an $11,884 Sea Doo – now that’s a little water toy that he rides. All of these new purchases have never before been required for GRDA operations. Allegations of extravagant entertainment, meals, and travel have also been made. So, I say to my friends who are nominees here today, your past TVA Chairman Crowell and Mr. Easley have a lot in common. Abuse of corporate aircraft, excessive compensation, no-bid contracts, and the list goes on.

Now, how about this one: GRDA has acquired a 2,200 square foot new office in downtown Oklahoma City. GRDA serves 24 counties in Oklahoma - Oklahoma County is not one of them. This is the first time GRDA has “needed” an office in Oklahoma City. This office is being leased at over twice the cost of what other state agencies are paying in rent. Although Easley originally reported to the press the total cost of the renovation to be $24,000, GRDA has spent over $135,000 to date for the renovations. It’s a play palace located in the trendy club and entertainment, Bricktown area of Oklahoma City located above Hooters restaurant and bar and next to the Wild Coconut Tiki lounge. A strange location for a quasi state agency to select for conducting the business of its rate payers, don’t you think? By the way – the new space will office only one GRDA employee.

Since becoming CEO, Easley has allegedly awarded no- bid, sole source, and inflated contracts to friends and colleagues for lobbying, marketing, and personal services - exceeding state limits for such expenditures.

Whether or not any of these actions are in violation of the law is something that Oklahomans are looking into, but what is not in question is the fact that a culture of ethical corruption has found a home at the GRDA.

Just as it was with the TVA, I believe that only a change in leadership at the GRDA will bring about the cultural change to put it back in business of serving the people and out of the business of the people serving the GRDA. You cleaned up your house, now we need to clean up ours. Any time you have a gigantic budget with virtually no oversight, the temptation will be there. It’s the insatiable appetite of unelected bureaucrats to spend the public’s money on themselves. You have corrected your problem at TVA, we need to do the same. It is my hope that the new TVA board, who is sitting here today, will continue to make ethical behavior a top priority.

Again, I want to thank the nominees for being here today and I look forward to getting you all confirmed and serving the interests of this country.

 

 

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